The jargon buster – Understanding AdWords terminology

Pay-per-click (PPC) marketing technologies, like Google AdWords are a fantastic way to target prospects at every stage in the sales funnel. You can use them to raise awareness, make your company or product stand out in the marketplace, drive sales, and re-engage with customers.

But as much as Google tries to make its AdWords system as simple as possible, it is inherently complex and there is a lot of jargon in which it can be easy to get bogged down, whether you’re managing your own campaigns or reading the monthly reports.

In this jargon buster post, I’ll go through a few of the key terms you’re likely to come across (mostly relevant to Search campaigns), which should make AdWords a little easier to use and explain to others.

General terms:

If you’ve used AdWords, these should be familiar.

• Campaign – At the top level of your account, you have your campaigns, each with its own goal, assigned budget, and settings for targeting (including location, language, time, etc.). You can use a campaign to promote a particular product area and have everything within that campaign designed to achieve that goal. There are several campaign types:

○ Search Network only – Google search and partners that can show text ads

• Ad group – Campaigns are split into sub-sections, called ad groups, each of which contains ads, relevant keywords, and settings for a specific objective or theme. For example, you might set up different ad groups to promote different applications of your product.

• Ads – These can come in a variety of formats, from text ads in search engine result pages (SERPs) to video ads on YouTube. The choice of ad type is determined at the campaign level, and is dependent on the goal of your campaign and where you want to show your ads.

• Ad extensions – Additional copy and clickable links under ads to provide more information, such as shipping offers, reviews, and local promotions. They can also provide an alternate route to contact/convert, for example a “Call” or “Message” button for mobile users.

• Keywords – At the core of any campaign, keywords determine how your ads and target audience cross paths. Careful selection and evolution of keywords over time makes sure that your ads are displayed to the relevant audience.

• Bid – Simply put, this is the amount you are willing to pay, set as a maximum bid. There are several types of bidding, depending on the type of campaign, including:

Performance metrics:

Any AdWords report will inevitably contain a variety of performance metrics, which do change from time to time as the AdWords system is updated and enhanced. These are the metrics you’ll most often come across.

• Impressions – Indicates the number of times your ad has been shown. For display ads, an impression is only counted if a user sees at least 50% of the ad on screen.

• Clicks – This is likely the metric to which users pay most attention (because you’re often paying for each one!). Clicks can be attributed to any clickable element in your ad, including extensions. However, clicks do not apply for all ad types (see: Interactions).

• CPC (Cost-Per-Click) – As a performance metric, this indicates the cost of a particular click, and is often shown as an average CPC over a selected timeframe.

• CTR (Click-Through-Rate) – An important indicator of how well you are targeting your ads, and how effective they are. CTR is given as the percentage of impressions that led to a click.

• Interactions – This metric covers all interactions with your ad, and is applicable across all ad types. For example, an interaction might be a click through to your landing page, a call made via the call extension, or a view of a video ad. When viewing multiple campaign types, the AdWords interface will replace “Clicks” with “Interactions” automatically.

• Conversions – Possibly the most essential indicator of performance. Conversions are your goal and they can be triggered in a number of ways. This might be a purchase of your product, download of a PDF, submission of a contact form, etc.

• View through conversion – This is an interesting metric that is used to count a conversion where, although a user sees your ad, they don’t interact with it, but ultimately do. This can happen if the same user converts via another means or route, for example, by visiting the advertised product page organically and purchasing directly.

• Cost-Per-Conversion – Not to be confused with “CPC”, this is the average cost of a conversion when taking into account all clicks in the given period that could lead to a conversion. For example, ten clicks at £1.50 leading to two conversions would give a cost-per-conversion of £7.50.

• Ad position – As the name implies, this is the position your ad takes on a SERP. Since the removal of the sidebar on Google SERPs in 2016, only positions 1-4 can be visible at the top of the page. Generally, ads in higher positions are clicked more often than those below.

Quality indicators for search campaigns:

There are several quality indicators for keywords and ads, which ultimately contribute to the position your ad takes on a SERP and how much you pay for a click. Keeping these in check will help maintain a good ad position.

• Quality score – A score given to an individual keyword. This score is calculated based on “average”, “above average”, and “below average” statuses for the following:

○ Expected CTR – The predicted CTR based on historical data.

○ Ad relevance – A measure how relevant the ad and keywords in the ad group are to each other.

○ Landing page experience – The relevance and usefulness of your landing page, including ease of navigation and organisation.

• Ad rank – Calculated for individual ads at every eligible auction, ad rank is influenced by quality score and bids. As of May/June 2017, Google is also taking into account the user’s intent and the use of ad extensions.

These are just some of the terms used in Google AdWords, and largely focus on those relevant to Search campaigns. But they are also some of the most essential to understand, whether you review reports or run your own campaigns.

We’ll keep updating this list as PPC through Google AdWords evolves.

If you haven’t yet tried PPC marketing, but think it can fit into your marketing strategy, contact us. We can talk you through the options and, with our blend of science and marketing backgrounds, help develop a PPC programme that’s right for your business.

Written by Omee Ahmed – Digital and Scientific Specialist

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